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GlobalShop 2012: Family Dollar using new technology to get 'on-site insight' to increase sales

March 1, 2012

What if retailers knew how many shoppers went to specific store categories, how many of those shoppers dwelled and how many dwellers turned into buyers? Those were three questions presented Wednesday during a panel called "In-Store Innovation: How On-Site Insight Will Drive Merchandising Design Innovation" at GlobalShop in Las Vegas.

Family Dollar is answering those questions with the help of a new technology, said Don Hamblen, Family Dollar SVP of customer marketing. The small-box retailer recently launched ShopperGauge, an in-store behavior monitoring system that uses video and analytics to automate the process of collecting and analyzing shopper behavior in real-time as shoppers move about the store, interacting with brand messaging and displays. The system then generates quantifiable metrics showing how many shoppers visited each location and which brands were most effective in engaging and converting them to purchase.

Most retailers, according to Jon Kramer, chief marketing officer of RockTenn, the company behind the new technology, easily track how many customers come to their stores and what they purchase. What's missing is where shoppers went, if and when they stopped and what offers and advertising drew them to dwell and then eventually purchase.

"What if you knew? What if you had a really high value piece of real estate at the end of the aisle but could see that there was no traffic there?" Kramer asked, pointing to a video feed of a high-tech end cap inside a store. The video showed that the traffic around the display was so busy that a shopper wanting to explore the end cap was shuffled and bumped into, causing her to lose focus.

Another example Kramer showed was of a female customer shopping for a razor blade replacement with her small son. The video shows her looking so confused trying to sift through the options that she loses track of her son, who knocks over a bunch of products. She grabs him and leaves in frustration.

"You will notice that she doesn't buy anything," he said. "We can show you lots of examples; what would you do if you knew that? How does this change your thoughts about this category?"

RockTenn's technology, Kramer said, helps retailers answer these questions. They can learn how many shoppers go to a specific category, how many of them stop and engage with the product or display and how many of those people purchase the product.

After studying customer behavior with the system, Family Dollar used the data to make changes in how it displayed products, Hamblen said. For example, the retailer discovered that customers were not engaged enough while waiting in line, so the company is adding more products and displays in hopes of increasing last-minute sales.

"The data is very powerful," Hamblen said.

How it works

A matched panel of test and control stores in select retailers, including at Family Dollar, are now using ShopperGauge technology and are available for immediate access to live in-store shopper data by category, brand, aisle and end cap.

Manufacturers can engage in four-week testing periods where they can introduce new fixtures, display approaches, messaging, packaging and even change store location for certain products to understand shopper impact. Manufacturers can also immediately gain access to baseline data on how shoppers shop their category and brands.

The data is so easy to read that some clients analyze their own data, Kramer said.

"The beauty of this technology is that video is underlaid with a very sophisticated algorithm that turns the video into data, so at the end of the day you are not looking at hours and hours of data."